A Market in Transition
The UK music industry is in a fascinating place right now. In 2024, recorded-music revenues rose nearly 5% to reach £1.49 billion, despite inflation, rising costs, and shifting consumer behaviour. Streaming still dominates, but its growth is slowing. Physical formats are more volatile than ever, with vinyl thriving while CDs slide towards irrelevance.
For artists, fans, and labels, these shifts are reshaping how music is released, marketed, and consumed. And for independent pioneers such as Expansion Records, the UK’s leading soul label, 2025/26 will be a milestone moment: their 40th anniversary, right in the middle of this industry transformation.
Vinyl: The Revival That Won’t Quit
Vinyl continues to be the hero of physical media. In 2024, UK listeners bought around 6.7 million LPs, generating close to £200 million, up more than 10% year-on-year. Collectors, casual fans, and superfans alike are driving demand, often through limited runs, coloured pressings, and deluxe packaging.
Big name artists like Taylor Swift, Billie Eilish, and Sabrina Carpenter dominate headlines, but vinyl’s appeal goes much deeper. Indie and niche genres are flourishing in this space too. Labels like Expansion Records, which has championed soul, funk, and jazz since 1986, are perfectly positioned. Their catalogue translates beautifully onto vinyl, appealing to collectors who value timeless music in premium physical form.
With Expansion Records celebrating 40 years in 2026, expect exclusive reissues, limited editions, and anniversary vinyl to become highly sought-after among UK collectors and soul fans worldwide.
The Collapse of the CD
While vinyl is thriving, CDs are facing a starkly different reality. In mid-2025, UK CD sales dropped by more than 20% year-on-year. Without blockbuster releases to prop them up, the format is quickly losing relevance.
Unlike vinyl, CDs don’t offer nostalgia or cultural cachet. They lack the tactile appeal of records and the convenience of streaming. For collectors, they’re simply not desirable. Labels that once relied on CDs as the mainstay of their physical sales are shifting focus towards vinyl or digital.
Expansion Records is a good example of this pivot. Their emphasis on vinyl reissues and high-quality pressings of classic and modern soul has helped them stay relevant while others have seen physical sales collapse. Now while no longer the core business, and more to support the long standing audience of collectors and supporters Expansion maintains, they still do release CDs. The mastering will always be superior to streams, and the credits, liner notes, and photos they contain have value and this is appreciated.
Streaming Dominance and Slowdown
Streaming remains the backbone of UK music consumption, making up about 68% of all revenue in 2024. But its growth is plateauing, with year-on-year increases now closer to 5% than the 8–9% we once saw.
Market saturation is the main culprit. Most listeners who want a subscription already have one. Future revenue growth will come from price rises, bundling with other digital services, or better monetisation of catalogue music. But this also raises questions: will fans stick around when prices increase? And how much of that money will reach the artists and labels?
For independent labels like Expansion, streaming is both a blessing and a challenge. It ensures their artists reach global audiences instantly, but revenue share remains an ongoing battle.
Collectors, Superfans, and Indie Shops
The vinyl revival is fuelled by collectors and superfans, who treat records as cultural artefacts. Limited editions, anniversary reissues, and Record Store Day exclusives are driving sales.
Independent record shops have been central to this resurgence. They’re not just retail outlets, they’re community hubs and curators. Labels such as Expansion Records have long relied on indie shops to connect directly with dedicated fans of soul, funk, and R&B. As vinyl continues its upward curve, these relationships will only grow in importance.
Challenges Ahead
The industry still faces serious challenges:
• Volatility of physical sales: Vinyl growth depends on major releases and collector interest. Without big events, numbers dip.
• Production costs: Pressing vinyl is expensive, with rising material and distribution costs squeezing margins.
• Sustainability concerns: The production of multiple vinyl variants raises environmental questions. Fans and artists are calling for greener alternatives.
For labels celebrating milestones, such as Expansion’s 40th anniversary, these challenges may also present opportunities. By innovating in packaging, sustainability, and fan engagement, they can set themselves apart while still honouring their legacy.
Opportunities for Independent Labels
The current market offers plenty of opportunities for independent labels to thrive. Vinyl has given physical media a cultural rebirth, and streaming provides global reach. For Expansion Records, whose roster includes both classic reissues and fresh soul releases, the next year will be pivotal.
Their 40th anniversary isn’t just a milestone — it’s a chance to spotlight four decades of curating the best in soul, funk, and jazz. Expect collectors to clamour for exclusive vinyl editions, box sets, and anniversary events that tap into both nostalgia and forward-thinking curation.
Conclusion: Looking to 2026 and Beyond
The UK music industry remains strong, but its future is unevenly spread. Vinyl has carved out a lasting role, streaming is showing signs of maturity, and CDs are fading fast. For independent labels like Expansion Records, this is both a challenge and an opportunity.
As they prepare to celebrate 40 years at the forefront of UK soul in 2026, Expansion exemplifies how to survive, and thrive, in a changing industry. By leaning into vinyl, embracing collector culture, and using streaming strategically, they show that independence and longevity can coexist in today’s marketplace.
For fans, this means more than just access to music. It’s about connecting with heritage, collecting pieces of history, and celebrating labels that have shaped the soundtrack of our lives.